Fisher Price

c has been selling toys in a very moderate price with proper quality since a long time. Now that they are going to launch a product in riding toy product line segment, parents and the children have been very much interested in this product and have shown a positive response. The main problem arises when there was unforeseen manufacturing cost that had increased the price from $12.00 (originally projected) to $18.50. Jack Ashhalter is somehow in this dilemma that if he should or shouldn't launch the product in the fear that the retailers and the consumers might not accept such a high price for this product.

Situation Analysis:

Strength - ( Internal )

• The company sold their products in moderate prices, with five qualities (intrinsic play, ingenuity, strong construction, good value for the money, and action, Strong culture and corporate creed)

• The high sales of the new line (Music Box) gave the company resources and incentives for the future product introductions.

• Experience – four decades of designing and building toys and promoting from within.

The designers of the toys ensured maximum safety and made sure they were highly educational.

• The promoted an entire product line and did not push to single items that differentiated them from their competitors.

• Brand Equity , 64.7% voted Fisher Price as the best brand for Fisher Toys (Exhibit 9)

• Innovation, there is more focus on innovation and that leads to variety of products.

• Proven Production Cost Control Process

• Established channel of retail and distribution

• Established Sales Team

• Well versed with Consumer Buying Psychology

• Customer Loyalty , 82.7% of the people surveyed buy Fisher-Price products

• They target the right customer, e.g. the women's magazine.

Weakness - ( Internal )

• Fisher price had a rule of thumb that if they deviated from their moderate pricing strategy then the product would be a failure. ( The product should not be priced above $5)

• Due to their rule that they followed since decades they could not follow up other new exciting ideas that could've done much better. ( Not open to new ideas)

• Risk averse

• Weak Product Strategy Team, demonstrated by improper forecasting of the mark-up price

• Launching products in the new price segment ($18) has